Romanian Real Estate Market Grows

The Romanian and especially the Bucharest real estate market is registering good results and a growing sense of optimism that is mainly the cause of distributers and raw material producers, two of the hardest hit sectors of the 2008 financial crisis. Prices for Bucharest apartments for rent or sale are showing slow but steady growth.

Horatiu Tepes, owner and CEO of Bilka Steel, the largest producer of metal sheet roofing in Romania said that there is a change in the construction market, a change in the attitude of the producers and, of course, a change in the attitude of the clients. Tepes added that even if the cold and rainy spring weather didn’t allow for much construction work to be done, there is new optimism to be found in the entire field with new projects springing up both in the capital city as well as the rest of the country.

The Bilka Steel CEO said that the easier to get credits also helped the market; leading to stronger demand which in turn opened up delayed or unscheduled investment on a market that was one of the hardest hit by the financial crisis.

He said that the relaxed crediting helped developers make better rounded plans and take advantage of the low prices which are one third of those before and immediately during the crisis of 2008 and 2009. The stable euro and high demand for new apartments and homes will probably lead to strong growth throughout 2015 with even stronger growth to be expected in 2016.

Horatiu Tepes also said that everyone involved in the field, from developers to producers, had to work harder and tighten their belt in order to create more demand and a better, more affordable product. State funded projects like “Prima Casa” which allowed young couples and individuals to purchase housing at fixed or reduced interest and mortgages also helped the market get back on track, while more foreign investments in the industrial field also played their part.

According to Tepes, the market crash of 2008 – 2009 taught everyone a harsh lesson in terms of efficiency and expenditure cutting. He also said that 2009 was by far and away the most difficult year of the crisis because no one knew what to expect or where the market was going. He added that every producer and developer was looking to the competition to see how they would handle the reduced demand and tough funding, with everyone waiting for a clear sign that the market would start growing again.